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What Are the Advantages of Trusts in an Estate Plan?

Posted on in Estate Planning

Chicago Estate Planning LawyerDuring the estate planning process, the first step that many people take is to create a will. This legal document will detail a person’s instructions for how their affairs should be handled after their death. A will can be very helpful, and in addition to addressing how a person’s property should be distributed to their family members or other heirs, it may also name a guardian for the person’s minor children, detail their desired funeral and burial arrangements, and cover other important issues. However, there are many cases where creating one or more trusts in addition to a will can offer benefits. By understanding the purposes of trusts and the advantages they provide, a family can determine the role that these instruments may play in a comprehensive estate plan.

What Are Trusts?

A trust is a legal agreement in which a person will place their assets in the control of a person known as a trustee, providing instructions for how these assets should be managed and how they should be distributed to different beneficiaries. The assets will be owned by the trust rather than the person who created the trust (known as the trust maker or grantor). Setting up this type of agreement can provide multiple benefits, including:

  • Flexibility - Different types of trusts may allow a person to continue managing their assets, or they may allow another party to take over the management of their property. In a revocable living trust, the grantor may also serve as the trustee, allowing them to decide how assets will be used while they are still alive. They will also name a successor trustee who will take over management of the trust after their death or if they become ill or incapacitated. In a living trust, the grantor may also be a beneficiary, and this will ensure that they can continue using their assets to support themselves throughout their lifetime. In other cases, a person may want to create an irrevocable trust that cannot be altered, which may ensure that assets will be protected from creditors or other parties. A grantor may also provide specific instructions for how their assets will be used, which may prevent them from being wasted by beneficiaries.

  • Avoiding probate - When a person leaves property to their heirs in their will, the executor of their estate must go through the probate process before ownership of assets can be transferred to beneficiaries. However, assets held in a trust may be passed to 

  • beneficiaries outside of the probate process. This can allow for faster and easier distribution of a person’s property to their heirs, and distributions can be made either before or after the grantor’s death.

  • Privacy - Unlike a will, which will be accessible to the public after it is filed in probate court, the terms of trusts are private and confidential. This may allow a family to keep the details of their finances out of the public eye and avoid scrutiny over a person’s decisions regarding how their property will be passed to their family members or other heirs.

Contact Our South Side of Chicago Trusts Lawyer

If you have questions about how trusts may be used in your estate plan, or if you want to learn about your options for managing your assets and making decisions about your finances and healthcare as you get older, The Marques Eason Law Group can provide the legal help you need. Contact our Cook County estate planning attorney today at 312-973-3755 to arrange a confidential consultation.

 

Sources:

https://www.forbes.com/sites/rcarson/2020/02/24/do-you-need-a-trust-8-important-goals-a-trust-can-help-you-achieve/?sh=492c1a4352d4

https://money.cnn.com/pf/money-essentials-trusts/index.html

https://www.usbank.com/wealth-management/financial-perspectives/trust-and-estate-planning/benefits-of-setting-up-a-trust.html

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